STOCK GOODIES PLAYS OF THE WEEK

[GreenReeper]

There are two commonly accepted ways of determining buy and sell signals from a Coppock Curve.

The first is to trade on reversals from extremes. When the indicator was published in Barron’s (1962), it was intended to generate buy signals in the S&P 500 only, and the suggested signal was an upturn in the Coppock Curve from an extreme low.

The second interpretation involves divergence analysis. The initial thrust off of a low in the stock market is often accompanied by the highest Coppock Curve reading (peak momentum). Subsequent advances tend to be accompanied by diminishing momentum (lower peaks on the Coppock Curve). That combination of a higher peak in price accompanied by a lower peak in the Coppock Curve creates a bearish divergence. Those signals warn of a weakening, ageing advance, but often precede the ultimate top.